Lawyer productivity in law firms appears to have plateaued around roughly 1,550 hours, down from its high-water mark in 2021, according to Wells Fargo data. But analysts don’t expect a wave of layoffs as a result of overcapacity and lower utilization.

That’s not only because demand accelerated in the first quarter of 2024, and some excess capacity began to be “absorbed” in some of the largest firms. It’s also because billing rate increases are allowing firms to carry on with a lower level of productivity, analysts say.